Credit Cards and Bad Credit

Bad credit can affect anyone. Having bad credit can impact on your financial future, reducing your chances to get credit cards, personal loans, and mortgages. When you agree to have your credit history checked, you run the risk of being rejected because of a bad credit history.

What is Bad Credit?

Bad credit or bad credit rating is the jargon used to describe your credit value. Anyone who has applied for a credit card will have a credit file itemizing their personal details and other information such as:

• credit applications or enquiries
• current credit accounts
• overdue accounts or defaults (for up to 5 years)

Anyone who has been credit active over the past seven years, should have a credit file.

The information on your credit file is not permanently on your file but constantly updated and deleted after five years for all credit applications and defaults with any significant credit infringements and bankruptcies erased after seven years.

What results in bad credit?

For those who tend to be lazy about paying bills on time, you may end up with a default on your own credit file. Default credits can occur from various ways such as by not paying bills on time, exceeded credit card limits, had assets like your car repossessed, having utilities cut off, or defaulted on previous loans.

Seeing as all this information is recorded on your credit file for several years, you may be limited when you make applications.

How do I learn of my own credit rating?

Credit files can be seen as very practical for individuals with plans to apply for a sizeable loan as it provides facts of your credit history, and if you have good credit then this highly helpful.

To see a copy of your Credit File you will need to contact Veda Advantage at www.mycreditfile.com.au. Fees may occur if you require your Credit File immediately.

Once delivered check all the data in your credit file to guarantee there are no mistakes. If there are any mistakes on your credit file, they need to be addressed immediately.

In fact, it is highly worthwhile to check out your credit file annually as this is what financial institutions will assess your financial capability on and you need to make certain that all information is accurate.

How do you fix errors on your credit report

If you find any errors you have to contact the company that made that entry and ask them to correct the admission. If you have moved house you may find accounts that are overdue.

Keep in mind that default entries stay on your file for 5 years. If you do find a mistake on your credit file, report it immediately. These details will be investigated by the credit reporting company. Investigations can be a time consuming process, but make regular checkups for a progress report.

Tips on keeping a good credit file

Preserving a good credit file doesn’t have to be complicated. Avoid a bad credit file by:

• Paying your bills on time. On the chance that you don’t think you will be able make a payment, inform the company and give an approximate time as to when you will be paying.
• Appriasing your credit file regularly. Ensure all facts in your credit file are accurate and check over for fraudulent entries. If there are accounts you don’t recognise, investigate the accounts to protect yourself against any identity theft.

A clear credit file isn’t a guarantee approval for a loan or credit card. Most companies will have their own criteria that they use in conjunction with a credit file. Ask the company as to the specific reason that you were declined.

Having trouble repaying your credit card?

For people who are finding it difficult repaying all your credit cards, there are a number of options available to assist you consolidate debt and creating a way to pay off your credit card debt

One of these options is a balance transfer credit card. A balance transfer involves transferring the balance owing on one or more credit cards to a new credit card. There are a number of special promotions and deals on the market on balance transfers. These deals may include an introductory period where low interest or even zero interest applies.

Other great money saving tips

There are a number of great money savings tips that you can use to help meet your credit card repayments.

So if you suspect you have bad credit or have been declined a loan or credit card, check out your credit file and look for any issues or indications of poor credit rating. Credit ratings are the groundwork for your success in gaining approval for most applications, both personal and business. Ensure that your credit rating is working for you.

Tags: Cards, Credit

Category: personal loans